Before beginning the bidding war on a potential property, it helps to have an indication of how much you can afford. Some home buyers don’t fully understand pre-approvals. Even if you obtain a pre-approval, it does not guarantee you will qualify for the financing.
The main benefit of a pre-approval is that it will give you a good idea of how much you can afford in addition to holding a rate for up to 120 days (this varies by Lender) thus protecting you from any sudden rate increases.
Typically, the following is required for pre-approval:
Personal Identification
1. Current address
2. Contact information (phone, fax, email)
3. Social Insurance Number
Income / Employment
1. Current employer, job and salary. 3 years history.
2. Other sources of income (investments, pensions, etc)
Financial Assets/Liabilities
-Down payment amount and source (is it a gift, or from savings?)
Credit Check
-Your broker or bank will have to pull your credit bureau. Your credit score reflects your borrowing tendencies and will have an impact on the rate you qualify for
